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NEW YORK — Physicians Formula will celebrate its 68th year with just as many products. In addition to the usual cast of powders, concealers and shadows, next year’s assortment of 68 new items will spill over into a new category for Physicians Formula — skin care.

“The focus of the brand is very much problem-solution driven,” said Ingrid Jackel-Marken, Physicians Formula’s senior vice president of marketing. “Now, we are translating this approach to skin care.”

The company has created a subbrand for the occasion called Derm@Home Sensitive Skin Systems, and will kick off the effort this spring with a Mineral MicroDermabrasion System.

Jackel-Marken said she expects to introduce five more kits to the skin care aisle in 2006, and to expand the offering with two to five kits the following year.

While acknowledging the prevalence of similar kits in the mass market, Jackel-Marken said Derm@Home’s focus on sensitive skin — and the company’s healing heritage (the brand was created by Dr. Frank Crandall in 1937) — will carve out a compelling niche in the segment.

For instance, the $29.95 Mineral MicroDermabrasion System, billed as a more gentle alternative to similar kits, contains a mineral exfoliating cream, a handheld applicator (as opposed to battery-operated) for more control, and a mineral moisturizer designed to soothe skin post-treatment.

Jackel-Marken explained that the minerals used — namely alumina, rhodochrosite, malachite, smithsonite and mineral water — are shown to be effective and nonirritating.

The company will increase its ad budget nearly 15 percent to support its foray into skin care. Print ads, touting clinical results, will break in February beauty and lifestyle books.

Physicians Formula’s microdermabrasion kit will be launched on countertop displays and in the skin care aisle. While Jackel-Marken would not comment on sales, industry sources anticipate the Derm@Home line could generate $20 million in its first year.

The bulk of Physicians Formula’s spring offerings may fall into the cosmetics category, but new technology is pushing the company toward the cosmeceuticals realm. Noting that the brand has always had a functionality bent, Jackel-Marken commented, “I feel that we are just at the border of cosmeceuticals.”

This story first appeared in the October 28, 2005 issue of WWD. Subscribe Today.

That said, the company will introduce CoverToxTen50, a concealer designed to minimize the appearance of wrinkles by 50 percent in 10 minutes. Relying on gamma amino butyric acid, which is described as a commonly used “instant-gratification ingredient,” the $8.95 product is designed to mimic the effects of high-end items like Freeze 24/7.

To emphasize its cosmeceuticals focus, the company will shift its advertising strategy from an overall brand focus to more of a problem-solution approach, and call out product benefits and claims. It also will begin to feature individual products, such as CoverToxTen50, in its ads.

In the foundation category, Physicians Formula will expand its Mineral Wear franchise, which was introduced last year as a pressed powder, with a Talc-Free Mineral Foundation, Talc-Free Mineral Loose Powder and Cheek Palette Cream-To-Powder Blush. Each of the items, which range in price from the $7.95 powder to the $9.95 foundation, target women with sensitive, break-out-prone skin.

Physicians Formula aims to bolster eye category sales with the introduction of a Mineral Wear Duo Eye Shadow, and new twists on liners and mascara, such as Flatliner Automatic Eyeliner Pencil and F.L.A.T. Mascara — Fabulously Long & Thick, which features a flat brush and mirror on its outer packaging.

Industry sources expect the total cosmetics lineup to generate $50 million in first-year retail sales.

With several of its competitors — namely Maybelline, Revlon and L’Oréal — also introducing major initiatives for next year, display space in the mass market is at an all-time premium.

“It’s always a concern when there are major launches,” acknowledged Jackel-Marken. “But Physicians Formula is profitable.” Citing ACNielsen data, she noted that the brand’s share has grown 16 percent over last year.

Jackel-Marken added that the company is not simply replacing one collection with another to make room for its latest offering. “Just doing the swapping game is not the solution,” she said.

Despite heightened competition, Physicians Formula continues to nab more space along the cosmetics wall, and expects to expand its display by another foot at several major accounts next year.

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